Solicitors negligence: What is a 'sophisticated client'?

Professional negligence solicitor Emma Slade looks at the concept of the 'sophisticated client' in this latest edition of her popular blog.

I have recently been told by my opponents in two separate cases that we have 'sophisticated clients'.

While this may sound like a rather generous compliment, sadly, they have an ulterior motive and it is all because of Mrs Minkin.

Following a divorce, Mrs Minkin negotiated a financial settlement with her husband without input from a solicitor. She was a chartered accountant by profession so obviously knew her way around a spreadsheet or two and felt pretty able to understand what was going on. Even so, she had a few doubts about it and took advice from a solicitor who suggested that maybe, the agreement wasn’t as fair as she had thought. Even so, Mrs Minkin decided to continue with the settlement agreement. She and her ex-husband lodged a Consent Order with the Court but it was rejected for drafting errors. To assist with correcting the errors, Mrs Minkin instructed Landsberg t/a Barnet Family Law. Her instructions were clear: please re-draft the order so it will be approved by the Court. They did; it was; job done.

Mrs Minkin then had a change of heart and sued her solicitors for professional negligence.

She argued that Landsberg had been negligent for failing to advise her that the settlement probably wasn’t a good one for her. The Court found against her. Now setting aside the fact that Mrs Minkin’s instructions were very limited (“please re-draft the order”) and the fact that she had had previous advice on the suitability of the settlement, the Court also concluded that she was a “sophisticated client”. She was an intelligent woman who had qualified and practised as a chartered accountant, she was well versed in litigation and she understood complicated legal concepts. There were also copies of emails and other correspondence in the Trial Bundle which showed she had a good grasp of the issues and was clearly competent. In other words, she did not need as much help, assistance and advice as someone with less familiarity with matrimonial litigation.

The court concluded that while a solicitor has a duty to give advice that is reasonably incidental to the retainer, that duty is dependent upon the character and expertise of the Client in question. It is all fact dependent though. An experienced business person will not wish to pay for advice for something they already know; an impoverished client will not wish to pay for something that they cannot afford; an inexperienced client will expect to be warned of the risks which may be apparent to the solicitor but not to the client.

So what about my “sophisticated clients”?

Both clients are bringing professional negligence claims against their solicitor. And in both cases the defendants are arguing that the standard of legal advice they were required to give was lower because the clients were educated and knowledgeable - ergo the clients have no valid claim.

One of them is a lady who trained as a barrister, spent years in the industry as a practising solicitor and her correspondence was erudite and precise. They say she did not need as much advice given about the prospects of settling a legal action. Like an onion though, peel off the layers and you get a different story: she did a college course to be a barrister but never practised as one. She then trained as a solicitor in the Middle East in an area of law that had nothing to do with litigation and for a total period of less than three years. Her correspondence was littered with requests for legal advice and clarification.

The second is one is in my opinion even more tenuous. She runs a publication company producing information directories. Someone was trying to pass themselves off as being affiliated to her business and she wanted it stopped. She instructed solicitors but no advice was given to her about obtaining an injunction or, importantly, that by delaying an application for an injunction her chances of getting one would reduce. They claimed that she was an intelligent businesswoman and therefore they did not need to give her that advice, even though she has no previous experience of seeking an injunction.

In both cases, neither solicitor appears to have made any effort to establish the extent of their client’s knowledge and experience, or either discussed with them or let them know in writing that they would be limiting their advice.

I am sure that both my clients are flattered to be considered 'sophisticated', but in both instances, I think it would be a stretch to call them Minkin-sophisticated. It is going to be interesting though, to see how the solicitors in each instance continue with their line of defence Either way, I will continue to provide my sophisticated clients or – given my argument – not-so-sophisticated clients, a sophisticated service!

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